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Reform of state’s special ed funding: Just a step away from being realized

This article was originally published in The Notebook. In August 2020, The Notebook became Chalkbeat Philadelphia.

A bill that would fundamentally change how state aid for special education is distributed to school districts has one more hurdle: the state Senate.

The legislation, HB 704, has long been disability rights advocates’ top priority in Harrisburg. Their goal is to bring rationality and accountability to the funding distributed by the state to help districts pay for students with special needs.

Since 1992, the state has distributed special education aid under the assumption that each district had the same percentage of special education students, basing it on the statewide average, most recently 16 percent. But that average masks big differences among districts.

This procedure “wasn’t fair to many school districts and many students with disabilities,” said Sallie Lynagh, children’s team leader at the Disability Rights Network of Pennsylvania.

This bill, which passed the House, 173-24, requires state funding to be allotted based on the actual number of special education students per district, the type and severity of the disability, and local income and property tax levels. It “fixes the erroneous assumption that all districts in the state have the same number of students with disabilities, and that the needs of those students don’t vary from district to district,” Lynagh said.

Advocates are pressing the Senate, where they say it has bipartisan support, to take action on the legislation this fall.

Funding special education has always been a balancing act between giving districts what they need and discouraging them from over-identifying students to secure more money. The state switched to basing aid on the statewide average to combat overclassification.

According to a study sponsored by advocates, 391 of the 501 districts in the Commonwealth, educating nearly 195,000 students with special needs, currently lack sufficient funds to give them adequate services. The study said Philadelphia is slightly underfunded.

HB 704 would make other important changes, strengthening state oversight of districts’ special education services and establishing a competitive grant program as an incentive to boost the inclusion of special education students in regular classrooms. And it would expand the categories of disability from two to three, adding a designation for the lowest-need students.

According to Education Law Center Director of Policy Advocacy Baruch Kintisch, the proposed accountability system is stronger than what exists now because the state can withhold funds from districts that lack adequate and updated special education plans.

To get the bill through the House, however, its sponsors and advocates had to make significant compromises. The formula applies only to new dollars, not to the more than $1 billion already being doled out, meaning that no district will lose funds it already receives. And thanks to the state budget crisis, there will be no increase in the special education line item in this year’s budget – holding it flat for the third straight year. So struggling districts will not see extra funding any time soon.

Kintisch says the legislation will still have an immediate impact, since the formula will help districts understand their long-term funding situation and plan accordingly.

State Rep. Mike Sturla (D-Lancaster), the bill’s chief sponsor and a long-time advocate for reforming special education funding, says the budget crisis actually presents a political opportunity to push the legislation through.

“No one’s going to get any money out of this right now, so this is a time where you can rationally say, ‘It’s not going to affect my bottom line next year. Let’s actually do it based on need.’”